Thursday, February 26, 2009

Brief Response to the Article

Things Change So Quickly

I was very fortunate to be contacted by Rachel Brown, a free lance writer, who was writing about rural telecommunications, businesses, and the potential effects of the economy. I was contacted in the early Summer (before things, well, got stirred up..)

The excerpt pertinent to my section:

Focusing on the business side of the shop, another analyst said small telcos may actually benefit from a recession as businesses turn to them for a competitive edge. "Most small businesses realize that you get what you pay for," explained Zane Schweer, a small business telecommunications specialist. "If they skimp on telecommunications, it's not a good business move. You need telecommunications to survive. It's how you pull in clients, it's how you place orders, it's how you communicate."

For most companies, telecommunications is only 3% to 5% of the budget, Schweer said, adding that in a recession, many will look to additional telecommunications services to improve their bottom line. "Telecommunications is what drives businesses forward," he said. "It's not just a budget cost; it's an investment and revenue generator. A lot of businesses are looking to grow. They're not scared of an economic downturn."

Schweer also questioned whether the economy is truly in terrible shape. "If you turn on the news, it's all negative and there's too much emphasis on the economy," he said. "They don't focus on the positives."

Even the high cost of gas can be viewed positively, Schweer said. "Gas prices are pinching people, but it spurs innovation," he said, adding that telecommunications solutions can lower gas consumption. "Say that you have a fleet of trucks. With wireless and tracking technology, you can ensure that no one's getting lost or taking extra trips. If a driver comes in and has a 30-minute detour, you can ask, 'What's this about?"'

Higher gas prices also will spur video conferencing, Schweer said. "It's not as personal [as face-to-face meetings], but after 9/11, it's much cheaper and safer," he said. "And with cameras that move in the room and offer three-dimensional pictures, it almost feels as if you're there."

RTFC's Buchanan agreed that the green movement is growing. "In a world with increased energy costs, telecommunications assumes an even greater importance," he said, speculating that high gas prices will spur more telecommuting. "If people work from home, they'll need high-speed access to get into their company's virtual private network, so that means more broadband installations."

King and West said they haven't seen a huge shift toward telecommuting yet, but King agreed it's still a positive trend for rural carriers. "More people working from home translates into increased usage in residential landlines and increased demand for broadband," he said.

As another gas-saving example, Schweer cited a salesman who drives to client A and then back to headquarters to check e-mail and voice mail and then drives to client B. "With a BlackBerry, he can log in remotely and drive directly to client B," Schweer said. "In rural areas especially, this can translate into big distances--it's not uncommon to have 50 to 75 miles between clients. You want to be as efficient as possible, and telecommunications is what allows that."

I wanted to comment quickly on a couple of my remarks. I am sure some of you laughed when I said business' telecom. budgets are 3-5% of their expenses. It certainly depends on the industry and the type of customer. For example to look at the far extremes, an ISP provider's telecom expense is going to be fairly high (ie investing in a huge pipe of bandwidth and redundancy) while a Quickie shop would barely have any (ie couple lines and a DSL).

The blurring of the telecommunications and information technology fields also makes that 3-5% seem inaccurate and I embrace that fact. I was considering a simple, yet emerging small business.

Now, when I was interviewed, all the news of scandal and inappropriate money practices was unbeknownst to me (and the rest of U.S. and world), so I truly believed things were being over-played. I would be silly to still say everything is not a problem. Things are tough. Companies are laying hard-working people off left and right. But for media outlets to continually harp that we are doomed and in a Depression is overkill. Even President Obama is using words like "catastrophic". Let's stop using scare tactics here to push certain agendas. We are coping with a lot, but people are learning how to survive and push forward.

With the dynamic environment that we are in, we will see who the strong businesses are and weed out the weaker ones. It is painful and people are dealing with a plethora of hardships, but with hardships comes innovation. With innovation comes success and with success comes a rebound of the economy. (It will not happen overnight) There is a lot of good going on in the corporate world right now, but too many outlets are focusing on negatives all day long. (ie Cobblers See Resurgence (they aren't going to save the economy, but they are part of it) or AT&T Brining Back 4,000 Jobs (yes, they did lay off 12,000, but they are bringing jobs back from overseas), Manufacturing Moving Strong) We're in a rebuilding phase.

The rest of the article in relation to me continues on about innovation and looks for ways to streamline. A lot of businesses and people are in a certain routine and all it takes is for someone to come along and provide an alternative view point that garners value and of course, cost justification. Answering the question of, "How will this save me time, which will save me money?"

Every penny is being re-analyzed today. People need to evaluate how they do business. Invest time in contemplating alternative ways of doing business. If you have multiple locations that you travel between many times for meetings, why not, for example, invest in a multi-location video conference solution? Reduce windshield time, save gas money, and sit in your favorite chair. Do not go cutting all your expenses just to save money because if it affects how your provide service to your clients, you will do more hard then good.

I know I have sort of jumped around in this post, but on a whole, telecommunication companies, especially the rural ones are providing valuable service to clients. The reliance on telco. establishments to provide innovative solutions for you is only gaining momentum because if they do not, how will you reach your customers in the future? More importantly, how will they reach you?

~the GURU

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